Despite historical resistance to ADR by many popular parties and their advocates, ADR has gained widespread acceptance among both the general public and the legal profession in recent years. In fact, some courts now require some parties to resort to ADR of some type usually mediation before permitting the parties' cases to be tried1. The rising popularity of ADR and arbitration can be explained by the increasing caseload of traditional courts, the preference for confidentiality and the desire of some parties to have greater control over the selection of the individual(s) who will decide their dispute2.
In this work, we will look at the various types of arbitration and Alternative dispute resolution including their advantages and their relevance in today's consumer protection law. We will also consider the use of arbitration and ADR in Consumer Protection as was provided under the American Association of Arbitrators. We will also look into our own law to find out if there are any laws recommending and guiding the use of ADR and arbitration in Consumer Protection. Finally, we are going to review such laws to find out their efficiency or otherwise in our Consumer Protection Law.
This is a way of settling disputes. It is a situation where two parties decide before a dispute arises that if that dispute arises between them, they will settle the dispute in a particular manner. It is a method of settling disputes under which the parties agree to be bound by the decision of a third person whose decision is, in general final and legally binding on both parties. This process derives its force from the agreement of the parties with the aid of the courts which enforce these decisions3.
Thus arbitration is defined as a reference of a dispute between not less than two parties for determination after hearing both sides in a judicial manner by a person(s) other than a court of competent jurisdiction4. The term ADR is generally used to describe the methods and procedures used to resolve disputes either as alternatives to the traditional disputes resolution mechanism of the court or in some cases as supplementary to such mechanism5. It includes dispute resolution processes and techniques that act as a means for disagreeing parties to come to an agreement short of litigation6.
Negotiation: This is an indispensable step in any ADR process. It is a fundamental key to all consensual ADR activities and infact, the most satisfactory method of settling disputes. Usually, negotiation consists of a quid pro quo of a sort, i. e. giving up something in order to get something in return. It involves discussion or dealings about a matter with a view to reconciling differences and establishing areas of agreement, settlement or compromise that would be mutually beneficial to the parties or that would satisfy the aspiration of each party to the negotiation.
Compromise here implies flexibility on both sides and flexibility derives from a genuine desire on the part of the parties to reach an agreement9 participation is voluntary and there is no third party who facilitates the resolution process or imposes a resolution. Mediation: Mediation is at the heart of ADR. It is a process through which parties who have failed to resolve a dispute themselves can settle it through an independent third party called a mediator. A mediator is therefore a person who is trusted and accepted by both parties to a dispute.
His role is to assist the parties to reach an agreed settlement of the dispute. The procedure he adopts to achieve this is to meet each party privately so as to understand that party's own side of the story. In this regard, he shuttles between the parties and discusses with them in separate meetings known as "caucuses". He attempts to persuade each party to focus on his real interests rather than on what he thinks to be his contractual or legal right. Thereafter, he tries to bring the parties together so that they may themselves work out a compromise solution to the dispute.
He does not himself suggest a solution to the parties and cannot compel them to reach a settlement10. Collaborative Law: here, each party has an attorney who facilitates the resolution process within specifically contracted terms. The parties reach agreement with support of the attorneys who are trained in the process and mutually-agreed experts. No one imposes a resolution on the parties. However, the process is a formalized process that is part of the litigation and court system. Rather than being an Alternative Resolution methodology it is a litigation variant that happens to rely on ADR like attitudes and processes.
In recent years, the enforceability of arbitration clauses, particularly in the context of consumer agreements has drawn scrutiny from the courts in some jurisdiction12. Alternative dispute resolution is usually considered to be alternative to litigation. It also can be used as a colloquialism for allowing a dispute to drop or as an alternative to violence. In recent years there has been more discussion about taking a systems approach in order to offer different kinds of options to people who are in conflict and to foster appropriate dispute resolution13.